Friday, July 27, 2012

Read the latest updates below or online.
 

ACR Blog Roundup

Washington Roundup

Congress is just one week away from adjourning for five weeks of recess. It will return just after the political conventions conclude (Republican, August 27-30th, and the Democratic, September 4-6th). In the days leading up to recess we can expect spirited debate by both parties about the most effective way to avoid the year-end fiscal cliff, deep spending cuts and tax increases set to take effect on January 1, 2013.  Towards this end…

Senate Votes First

After a full day of political messaging on Wednesday (July 25th), the Senate voted on two plans to address the tax increases set to kick in on January 1st.  The Democrat’s plan passed narrowly, 51-48, while the Republican plan was defeated 45-54.  In general, the Democratic plan extends current tax rates to families earning less than $250,000, but allows rates for higher earners to expire.  The defeated Republican plan would have extended current tax rates for all tax payers. 

Wednesday’s Senate votes were more about politics than policy, allowing both Democrats and Republicans to express their positions on tax rates in advance of November elections.

House of Representatives Is Next

Next week, the Members will debate the House Republican proposal which is identical to the Senate Republican plan; it will not consider the Senate-passed bill.  This House measure is expected to pass along party lines.

Also on the agenda for debate by the full House is a bill that proposes an expedited process for upcoming tax reform in 2013.  The current version of this measure states that by April 30, 2013, the House Ways and Means Committee chairman must introduce a bill meeting certain targets for individual tax reform, such as a 25% top rate.  It also sets a specific timeline for votes on the legislation in both the House and Senate by limiting time for debate and restricting the number of amendments that can be offered.  Although this bill is only expected to pass the House, passage would be significant since it would bind the House to act on a major rewrite of our tax laws for the first time since 1986.

Former “Super Committee” Member Outlines Plan for Tax Reform and More

In a speech on Monday Senator Pat Toomey (R-PA), a first-term Senator who served on the Super Committee, outlined his plan for comprehensive tax and entitlement reform.  The Senator proposes to lower all individual tax rates by 20% and decrease certain tax benefits such as itemized deductions (which includes the charitable deduction.)  While Senator Toomey was not specific about which itemized deductions would be cut the most, he did say that those individuals earning the most would be targeted. (Continued...)
 

Consider This

The Battle Over Capping Tax Cuts

Remember Gilda Radner’s character Emily Litella on Saturday Night Live?  She’d say things like, “What’s this about President Ford wanting to make Puerto Rico a steak?  If you make Puerto Rico a steak, next thing they’ll want is a baked potato!”  When interrupted to be told it was “state” not a “steak” that the President was considering, Radner would mutter, “never mind.”

As of this writing all of official Washington is wrapped up in a bitter debate over the Bush-era tax cuts and what to do when they expire... (Continued)

Making Headlines

Tax Reform/Charitable Deduction

Fix the Debt Campaign: Former Clinton White House chief of staff Erskine Bowles and former Republican Senator Alan K. Simpson of Wyoming have a launched a $25 million campaign with business leaders, budget experts and former politicians to build public support for a plan to tackle the national debt by raising taxes and cutting retirement programs. Also see: Fix the Debt Campaign and Bowles and Simpson: Still pushing boulder up the Hill, CNN Money

Federal

Congressional Hearing: During this week’s House Ways & Means Committee hearing, the second in a series on tax-exempt organizations, Members heard from the IRS on its challenges in determining the taxable income of nonprofit organizations and the burdensome nature of the revised Form 990. Also see: Hearing Advisory: Boustany Announces Hearing on Public Charity Organizational Issues, Unrelated Business Income Tax, and the Revised Form 990 and Witness List & Testimony

501(c)(4)s: In response to heightened public interest in the campaign-related activities of 501(c)(4) groups and requests for investigations, the IRS has signaled it will consider revising rules governing 501(c)(4) "social welfare" nonprofits. Also see: IRS Letter to Democracy 21 and IRS Sizes Up Political Groups' Tax-exempt Status, Chicago Tribune.

States/Local

New Hampshire: A recent investigation of executive compensation at New Hampshire’s nonprofit hospitals that finds CEO pay has increased by eighteen percent in recent years has prompted discussion across the state. Nonprofits defend the higher compensation noting that “sweeping demands” placed on charitable organizations justify the increases. Also see: Report: Executive Compensation at New Hampshire’s Non-Profit Hospitals and New Hampshire Public Radio Interview: Examining Executive Salaries at the State’s Nonprofit Hospitals.

Transparency

Building upon a conversation and debate at an event co-hosted by The Philanthropy Roundtable and Aspen Institute in May, Nonprofit Quarterly’s Rick Cohen addresses transparency and challenges foundations to engage in more expansive and standardized disclosure of information about their organizations – in advance of mandated regulations.

Comings & Goings (Nonprofit Leadership)

GuideStar: GuideStar USA, the nonprofit website that publishes data on charities, announced that Jacob Harold, a program officer at the William and Flora Hewlett Foundation, will assume the chief executive position.

This Caught Our Eye…

Council on Foundations: Vikki Spruill, the new president and CEO of the Council, shares her vision for the membership organization: “to help society better understand philanthropy’s impact and contributions.”

Impact Investing: The Washington Post reports on foundations and nonprofit organizations employing new business models to build financial security and achieve their social missions. Critics raise concerns about the difficulties nonprofits face with such endeavors.

Disaster Funding: Using the recent devastating fires in Colorado as an example, Josie Burke of El Pomar Foundation discusses how foundations can build funding for natural disasters into their giving strategy.

Sunsetting: Atlantic Philanthropies, the 13-year-old foundation of Charles F. Feeney which plans to end grantmaking by 2016 and close its doors by 2020, has announced its final grantmaking priorities.

Connected Philanthropy: Author Matthew Bishop suggests that philanthropy will increasingly be driven by individuals leveraging their social networks and (social) media to inspire others to give as demonstrated by Warren Buffett inspiring his wealthy peers or millennials raising money for causes they support via online tools.

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